AHMAD IZZUDDIN BIN MOHAMAD

2018224724 EMD6M11

INDIVIDUAL ASSIGNMENT

Figure 1 represents the difference between the proper planning of the inventory and
improper planning of the inventory level. TPS / JIT is known for its best planning to increase
the efficiency and decrease waste by receiving goods only as they are needed. Compared to
conventional manufacturing system where the production is based on the forecast.

Imagine the water level as inventory level and the boat as the process of raw materials. As
long as inventory level is high, the process will not suffer a shortage. Thus, it will carried high
risk.

If inventory reduction is carried too fast without caution, the process may be starved of
materials. Thus, the boat will hit the rock that act as problem.

So, the best way to reduce inventory, is doing it step by step. Inventory level is lowered with
caution until first problem show up. The problem will be analysed and solve systematically.
Each time a problem is solved, the process runs smoothly again with the new inventory
level.

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